Calls for inquiry into Javelin Park incinerator rejected

In an open letter, the county council’s chief executive Peter Bungard said launching an inquiry into the independence of external auditors Grant Thornton would be too costly and over-resourced.

Community group R4C last week demanded the independent inquiry take place, claiming the multi-million contract for the Javelin Park rubbish burner was unlawfully awarded.

They have launched a legal challenge and will be taking the county council to court.

The authority revealed last month that the incinerator contract will cost at least £102million more than the £500million expected when negotiations began five years ago.

Mr Bungard added that a further inquiry cannot take place while the legal challenge now sits with the High Court.

The county council has had three inquiries from external auditors into the contract, two from Ernst and Young and one by Grant Thornton which is due to be published.

Last year the county council was told by the Information Commissioner that it must publish previously redacted details, through Freedom of Information rules, which the authority had said was “commercially sensitive”.

Those details, released on December 21, revealed that the incinerator will cost £112.47 per tonne to burn the waste.

Further findings showed that the project will make a loss against budget for the first three years, which the council will have to plug from its reserves

Community R4C group member Sue Oppenheimer previously said because of the cost increase, the contract should have been re-tendered.

WHAT PETER BUNGARD SAID IN FULL

“To the 10 signatories of the open letter received by the County Council on 7 January 2019 (albeit dated 2018).

“Given the use of an open letter, I feel my reply should also take this format. I wish to apologise for the delay in replying.

“The open letter requests the establishment of an independent inquiry into value for money; availability of information at decision points; not considering prudential borrowing; the contract’s compatibility with the objective of reducing waste; and disclosure of documents. The letter also challenges the independence of the Council’s external auditor, Grant Thornton.

“Before replying to the request, it is helpful to refer to the current challenge to the Council’s annual accounts for the year ended 31 March 2017, because a significant number of the assertions which are made in the open letter are addressed in the challenge to the accounts.

“By way of background, in April 2017 a number of individuals lodged a complaint with the Council’s auditors, Grant Thornton, on the following basis:

“Requesting the production of a report in the public interest under schedule 7 of the Local Audit and Accountability Act 2014 (the 2014 Act); and Seeking a declaration from the court under s28 of the 2014 Act that there is an unlawful item of account.

“The grounds of the complaint relate to the contract and were essentially about whether the Javelin Park Energy from Waste (EfW) contract provides Value for Money and refers to the Council’s procurement process.

“In considering your request for an independent inquiry I have noted the issues raised in the open letter are very similar to the matters referred to within the complaint to the Auditor and, on which the Auditor will be making an independent/impartial judgement about whether the Javelin Park EfW contract is value for money. It would be a duplication of resource and cost in taking forward a further inquiry.

“Also, you are no doubt aware that a claim has been issued at the High Court by Community R4C Limited against “Gloucester County Council”. In the light of the issues raised in those proceedings, which will be a matter of public record, and which directly reference your open letter, it would not be appropriate for a further inquiry at present.

“On the basis of the above I am not prepared to initiate a further inquiry.

“I note that the issue of the Auditor’s independence has been raised in the open letter. This matter was discussed at length with Grant Thornton at the outset of their complaint investigation. They provided assurance that suitable controls would be in place to allow the Auditor to carry out their work independently. I would also point out that in the nearly two years since the complaint was first made this question of independence has never been raised to my knowledge.

“I hope this helps clarify matters.

“Yours sincerely

“Pete Bungard

"Chief Executive

Gloucestershire County Council”

Work on the project began in 2016 and the incinerator is due to begin operating in July.

The county council have previously argued that the Javelin Park facility is good value for money, and will provide energy for 25,000 homes while saving £100million over 25 years.